Rajasthan Passes 1st Ever Gig Workers' Bill: Does it Regulate Work Conditions?

The Rajasthan Assembly recently passed a bill which proposes to extend social security to gig workers in the state.

The Rajasthan Assembly on Monday passed a bill which proposes to extend social security to gig workers in the state.

(Image: The Quint/Chetan Bhakuni)

Gig and platform workers and their collective organisations have managed to bring several important issues to the forefront of public discourse. These include algorithms that are used to control worker behaviour, resulting in poor wages and working conditions, long and stressful hours of work, surveillance that restricts collective organisation, and concerns about protection of workers’ data.   

Gig and platform workers, like most of India’s informal workers, also do not have access to social security measures such as ESI (Employee’s State Insurance) and EPF (Employee’s Provident Fund).

This lack of social security coverage seems to be the focus of the Rajasthan Platform-Based Gig Workers (Registration and Welfare) Bill, 2023, which was passed on Monday, 24 July.

As the first effort in India to provide labour protections for gig and platform workers, this legislation requires both commendation and closer scrutiny. Here's what works and what doesn't.

Bill Sticks to Old Norm of Gig Workers Only Being 'Partners'

The mainstay of workers’ demands around gig and platform work has been worker/employee status. Currently, most aggregators insist that gig workers are not workers but ‘partners’ (or use other similar terminology that does not acknowledge an employer-employee relationship). 

The present Bill also defines gig and platform workers as those ‘outside of a traditional employer-employee relationship’, adopting more or less the same language as in the Code on Social Security, 2020.

Merely defining them as a worker does not mean that they will automatically get rights under labour laws. Their rights must be spelt out explicitly.

Good Call to Set Up Welfare Board, Levy Cess on Aggregators

Rajasthan’s bill is focused primarily on social security and does not attempt such a comprehensive exposition of gig and platform workers’ rights.   

The core of the legislation lies elsewhere: the Bill establishes a “Platform-Based Gig Workers' Welfare Cess,” and a welfare board to manage how this money is collected and spent. The cess shall be levied from the aggregator or the employer (not the consumer, or the gig and platform worker), and shall be on each transaction related to the gig worker.   

The rate of the cess is yet to be notified but the upper limit has been kept at two percent of the value of each transaction. What is interesting is that the legislation sets up a mechanism to track these transactions, through a Central Transaction Information and Management System (CTIMS). This is crucial: a record of every payment made to the gig worker will now be available with an entity other than the aggregator.

Arbitrary deductions and lack of transparency when it comes to payments has been a major issue with gig work. The present bill stops short of putting any restrictions on these matters, and limits the CTIMS to keeping a record of the commission charged by the platform, the cess levied, and the GST deducted.  

Offloading the cost of the cess to either gig workers, or consumers (through marking up the prices, for instance) could also be a concern.

Still, with the transaction recorded, there is much potential to broaden the ambit of the mechanism and bring in meaningful provisions on transparency of payments. 

The Bill provides that the details of welfare cess collected and spent shall be disclosed and made available for inspection on the CTIMS, which can make misappropriation of the fund more difficult.

A related issue is that there is no definition of what exactly the value of a transaction is. As aggregators routinely rely on incentives to manage workers’ performance, this could lead to ambiguity.   

Board to Register Gig Workers Using Unique ID, Registration to be Transferable

The most important body in the Bill is the Rajasthan Platform Based Gig Workers' Welfare Board, which has been given a wide variety of functions. In addition to utilising and managing ‘The Rajasthan Platform Based Gig Workers Social Security and Welfare Fund’, into which the cess payments will go, the Board also has the responsibility to maintain the CTIMS, to register and maintain a database of gig workers, aggregators and primary employers.   

The Board shall have five representatives each from both aggregators and gig and platform workers (in addition to government officials from relevant departments and the chairperson, the Minister of Labour).

The Bill also provides that one-third of the total members of the Board should be women.

The Board also includes two members from civil society but there is no indication in the Bill of what their background should be. In a forum that has such a wide range of functions, and should ideally balance interests of workers, aggregators, and the State, it would be useful that these persons are required to have some experience with labour law.  

The Board also ensures that the app of the aggregator is integrated with the cess deduction mechanism. It is the Board that shall formulate and notify a social security scheme for gig and platform workers, as the Bill does not bring into effect any specific social security scheme but enables the Board to do so.   

The aggregator has the duty to provide the database of all platform-based workers onboarded with them to the Board, which then registers and generates a Unique ID for each platform-based gig worker. This registration with the Board is valid in perpetuity: this indicates that the registration will not be invalidated even if the gig worker is no longer associated with a particular platform or aggregator.

However, the workers’ representatives in the Board will be nominated by the State Government, and not through any democratic process that involves the gig and platform workers, or any form of collective organisation of gig and platform workers.

Even though the state nominee could be good, it is good practice to have a someone elected or selected by the collective organisation (such as a union) to represent them on the board.

No Role Mentioned For Workers' Collectives In Bill

The Bill also does not put in place any mechanism through which workers’ collectives can meaningfully take part in the functions of the Board. There is a provision that indicates that the Board should engage with registered unions who work with gig and platform workers and hold ‘regular’ consultations, without specifying how frequent these consultations should be.

There is also no indication of what issues necessitate such a consultation. This means that there is no mandatory provision for involving unions in issues that could significantly affect workers’ rights.   

The Board can also nominate a person to act on behalf of a gig worker to initiate an action or a claim under the law. Again, there is no role specified for unions or organisations here.

The only method for addressing workers’ grievances in the Bill seems to be a gig worker directly approaching an officer designated by the state government for such purpose, failing which they may appeal to ‘Appellate Authority’ (defined as the welfare board’s member secretary who is the Secretary in charge, of the Labour Department).  

What is the Procedure for Grievance Redressal?  

The procedure for grievance redressal has not been laid down in the Bill. This means that there is no set timeline for beginning an inquiry, or disposing off a petition. Given the range of issues that gig and platform workers have reported to have with apps (arbitrary deductions, non- allocation of orders, and blocking of IDs, among others) and the history of unreliability of grievance redressal mechanisms, such a provision seems to be nominal at best.   

The act defines aggregators and ‘primary employers’ separately (the primary employer is someone who engages gig and platform workers directly) but their duties and liabilities are mostly the same.

However, if the aggregator or primary employer fails to make the payment of the cess, they are liable to pay a fine -- ranging from Rs 10,000 to Rs 50 lakh.

It is interesting to note that if the defaulter does not pay the fine, the government can recover it by any method prescribed in the Rajasthan Land Revenue Act, 1956, which includes the attachment of their properties.

What About Workers’ Contributions?

The Bill provides that the platform-based gig workers shall have access to general and specific social security schemes (to be formulated by the Board) based on a contribution made by them but there is no specification on how much this contribution should be, no upper or lower limit, or how it is to be collected. 

The language of the provision also seems to indicate that in the absence of contributions, the gig and platform worker will not have access to social security measures formulated by the Board. These issues will have to be addressed when the Board formulates a social security scheme.

Given the low rate of wages and the uncertainty of income, the contributions from workers should be kept low. The scheme should ensure that the method of collecting contributions from the worker does not enable the aggregator or the employer to offload any costs to the gig worker, or further reduce wages.   

Does the Bill Plug the Lacunae in Gig Workers’ Employment?  

The Bill should be taken for what it is: a provision for a minimal amount of social security for gig and platform workers, which does not attempt to regulate the conditions of gig work in any significant way.

It also missed the opportunity to strengthen gig workers’ collective action by failing to involve workers’ organisations in any meaningful manner in its functioning.   

However, in the absence of any legal protections related to gig work, the establishment of a cess levied from aggregators, managed by a Board with some form of worker representation, is quite significant.  

Jasoon Chelat is a Researcher at the Center for Labour Studies, Jawaharlal Nehru University (JNU).

(This is an opinion piece. The views expressed above are the author’s own. The Quint neither endorses nor is responsible for them.)